OIL: Crude Time Spreads Decline Pauses After OPEC+ Delay

The softening on the crude curve backwardation has paused today as oil markets weigh the impact of the two month delay to the OPEC+ production rise, originally planned for October, against the backdrop of ongoing concern for demand growth in China and the US.

• The Dec24-Dec25 spread has fallen to the lowest since May23 with risk of a switch to a market surplus. The spread has however followed the bearish sentiment in the front month futures market down to $1.54/bbl from a recent high of $4.16/bbl on Aug 26.
• The prompt is seeing more support from tighter supplies due to the recent Libya outages and Kazakhstan maintenance and with another draw in US crude stocks this week.
• The prompt Brent spread has however still pulled back to levels seen in early August from as high as $0.97/bbl on Aug 29 to $0.37/bbl today.
• Technical analysis shows first Brent Nov24 contract support at the Sept 4 low of $72.35/bbl and WTI Oct24 contract support at $68.75/bbl.
  • Brent NOV 24 up 0.6% at 73.1$/bbl
  • WTI OCT 24 up 0.5% at 69.52$/bbl
  • WTI-Brent down 0.08$/bbl at -4.22$/bbl
  • Brent NOV 24-DEC 24 up 0.03$/bbl at 0.39$/bbl
  • Brent DEC 24-DEC 25 up 0.12$/bbl at 1.53$/bbl
  • WTI OCT 24-NOV 24 down 0.01$/bbl at 0.64$/bbl
  • WTI DEC 24-DEC 25 up 0.13$/bbl at 1.76$/bbl